It may seem like a dumb opsec mistake to pick a name from your town, but lets remember, at that point we're talking about launching a cool experiment about digital money worth $0, not about picking a pseudonym as the figurehead of a project worth a trillion dollars.
After reading an article about it, I do wonder about Len Sassaman, who apparently fits Satoshi's timezone and "accent" better. It could even have been both of them collaborating...